Home » Zambia’s debt to China is nearly double the official estimate

Zambia’s debt to China is nearly double the official estimate

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The analysis of loan data by the China-Africa Research Institute (CARI) estimates that Zambia’s debt to the Chinese government and private lenders amounts to US$6.6 billion, almost twice the amount disclosed by the previous government of Zambia.

According to a report from Reuters today, Zambia, which is rich in copper mines, became the first country in Africa to default on sovereign debt due to the new crown epidemic in November last year. Its ongoing debt restructuring has become a test case of Western countries’ efforts to allow countries to fully disclose the amount of borrowing. .

The former government of Zambia, led by Edgar Lungu, stated that its debt to China was US$3.4 billion. But the estimates released by CARI on Tuesday are consistent with the recent comments of the newly elected President Hakainde Hichilema, who took office last month, that the debt burden may be higher. According to the China Africa Institute, Zambia’s debt to China is close to twice the official estimate.

The Zambian government is negotiating with international creditors. International creditors complained that Zambia’s debt to China lacks details, because it is accompanied by clear confidentiality clauses; this hinders the debt restructuring process.

According to CARI researchers Deborah Brautigam and Yinxuan Wang, who made this new estimate, “Given the complex situation… reaching a consensus on the sharing of responsibilities can be particularly difficult.”

Reuters said the new figure of US$6.6 billion was calculated based on China’s loan data collected by the Johns Hopkins University School of Advanced International Studies CARI. The number may continue to increase, as this does not include continued accumulation of fines or interest owed.

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The news did not mention the relationship between debt and Zambia’s GDP.

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